Before the Flood

Just as flood insurance premiums are projected to rise, more New Yorkers are expected to be informed that their risk of flooding has gone way up – thanks to the Federal Emergency Management Agency (FEMA) and its woefully outdated flood insurance rate maps.

The problem is that the flood maps have not been seriously updated since 1983. In January 2015, preliminary maps were released. These increased the number of New York City homes that the feds considered a high risk for flooding in extreme weather. Some 35,000 homes were now in the highest-risk zones – and if any of them had federally backed mortgages, they were now required to buy flood insurance.

That summer, though, New York City officials submitted analyses and data that would adjust the preliminary maps and take some of those homes out of the highest-risk zones. In a pleasant display of governmental cooperation, FEMA announced this past October that it had agreed with the city’s submissions and that the data submitted would be used to update the maps again.

How does this affect insurance rates right now? Anyone who bought or renewed a policy before April 2016 – before the federal government agreed to revise the maps – will still be paying premiums based on the 2007 maps. Anyone who bought a new policy after the preferred risk extension expired on March 31 saw higher premiums based on a 2009 rezoning, according to Justin Kraus, a supervisor at Mackoul & Associates insurance brokerage.

What if you’re on the cusp of a flood zone? There are potentially thousands of homes now in an insurance gray area, waiting to see if they’re still going to be in a high-risk zone after the city and FEMA finish their revisions. The best course of action for residents on the edges of the preliminary zones seems to be getting an insurance policy now: when the new maps are complete, there’s a possibility that your risk may increase, along with your premiums. Buying a policy now (and not letting it lapse) allows homeowners to take advantage of the preferred risk extension for up to two years, which gives them a chance to plan for any rate increase.